Icelandic government says it wants to help homeowners

reykjavikA bill has been introduced by the Icelandic government aimed at helping the country’s householders and reducing the stockpile of repossessed housing currently in possession of the Housing Finance Fund.

A new buying/rental system will be established at Iceland’s Housing Finance Fund as a means of getting rid of repossessed properties in its possession.

People’s renting and purchasing rights will be insured and better laws will be imposed on housing co-operatives. The bill also calls for interest and home rental top-ups to be replaced by general ‘housing relief’ which would also apply to homeowners’ mortgage payments.

The bill would see householders spared the ignominy of being declared bankrupt for longer and make the law work harder to keep them in their homes, Visir.is reports.

The government’s ideas to help struggling households were delivered in a press conference yesterday where it was announced that more people would become eligible for help and that payment assistance and subsidies will all be brought together into a single system.

Alongside the new bill the government also announced it intends to set up a new debt agency to offer politically-impartial advice to householders and the agency head will become the spokesman for debtors in creditor negotiations and will not need to be neutral.

Further details of the government plan include:
Special remedies for low-paid workers and those suffering temporary pay cuts

A new strategy for people with two homes

A new lower maximum for penal interest

The sale price of houses sold at compulsory auction will be discounted from the debt

People will have the right to stay in their homes for 12 months after bankruptcy or compulsory auction is announced

Lower maximum interest charges

Re-examination of tax debt write-off laws

Reduced relevance for inflation indexed mortgages

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